New Proposal Can Change Digital Currencies Laws in Europe

A new proposal was announced by the European Commission that can drastically change the environment for digital currencies in the European Union.

This is after Bitcoin was determined by the European Court of Justice to be treated in the same way as traditional money. In a statement they released that bitcoin transactions “are exempt from VAT (value-added tax) under the provision concerning transactions relating to currency, bank notes and coins used as legal tender.”

The recent terrorist attacks in Paris have led to the commission deciding there needs to be more anti money laundering regulations with the popular digital currency. The exact nature of the regulations will be determined in the second quarter of this year.

This is an expected course of action though as other countries in the world are also beginning to implement ways to deal with the growing influence of Bitcoin and blockchain technology.

In addition, the European Court of Justice might apply the licensing and supervision rules of the Payment Services Directive, which sets the regulations for payment services, to digital currencies. This is to ensure they can “promote better control and understanding of the market”.

If this happens, the PSD would need to revise their definition of funds, which currency only includes cash, bank and e-money, to also include crypto currency. This means they will likely have a wider change to their regulations that simply adding the PSD’s licensing and supervision regulations to digital currency.

We must wait to see what the proposed regulatory changes will be, as they are currently very vague. Very likely, digital currencies might be accepted officially into the European Union payment regulations, which could allow bitcoin business to thrive across Europe.

This could also be great for business in Canada, where our government has been waiting to decide on how to respond to bitcoin. In a report by the Canadian Standing Senate Committee on Banking, Trade and Commerce they announced that the “government should exercise a regulatory “light touch” that minimizes actions that might stifle the development of these new technologies”. If new regulations are tested in Europe and work, it might lead to adoption or refined to be improved in Canada.

Michael Gord

Michael Gord is the founder of Bitcoin Canada and a has setup dozens of venues to accept bitcoin in Toronto and Montreal. Michael is a recent graduate of McGill, where he organized the Bitcoin Airdrop events that gave hundreds of students their first bitcoin. Michael is now studying decentalized application development and is involved in ethereum mining.
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NewsBTC is one of the largest online resources for Bitcoin and cryptocurrency news. Canada is a World renowned development hub for Bitcoin and FinTech advancements so extending NewsBTC specifically into Canada was a logical step. Having previously been involved in the earlier days of Bitcoin publishing significantly helped with my re-entry into the mix and it is thrilling to be a part of the NewsBTC family in representing Canadian FinTech.